Vedanta and Barclays did not reply to ET’s queries. Citi, JP Morgan and Standard Chartered Bank declined to comment.
Mumbai: Anil Agarwal-controlled Vedanta Resources is raising up to $2.5 billion in short-term loans from global banks such as JP Morgan and Barclays to finance the buyout of Vedanta Ltd’s public ownership ahead of the stock’s proposed delisting on Indian exchanges.
Standard Chartered Bank and Citi are also among the top global lenders set to underwrite the facility that will likely have three-month and 12-month maturities, multiple sources with direct knowledge of the matter told ET.
The loans are set to be backed by covenants that include dividend upstreaming of various group firms of the London-based billionaire, they said.
On May 18, Vedanta’s board approved the delisting of the locally listed holding company after considering the due diligence report by SBI Capital. Vedanta Resources will buy out public (minority) shareholders and take the commodity producer — Vedanta Ltd — private, according to the broad terms of the arrangement.
Vedanta and Barclays did not reply to ET’s queries. Citi, JP Morgan and Standard Chartered Bank declined to comment.
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“This is kind of a short-term loan that the foreign banks are extending. Loan covenants will add to the lenders’ comfort,” said one of the persons cited earlier.
The loan is likely to be priced after adding a spread of about 250 basis points over the London Interbank Offered Rate (Libor) plus fees, market sources said.
